I've done an informal polling of my friends whom I've introduced to melatonin, and the majority of them noticed more vivid dreams without me mentioning it.
I use it only occasionally, but the effect it has on my dreams is too large to fake (and I noticed it before ever hearing that it was supposedly a common side effect)
I've noticed it too, but I didn't really think it germane to a cost-benefit evaluation. More dreams is a mixed blessing in general - unless one wants to do lucid dreaming, which is an entirely different kettle of fish, and this little essay covers enough as it is.
Full essay: http://www.gwern.net/Melatonin